FDA moves to undercut huge price increase by pregnancy drug maker

WASHINGTON -- The Food and Drug Administration took the unusual step Wednesday of inviting pharmacies to make a legal end run around a St. Louis company that obtained agency approval for a pregnancy drug and promptly raised the price from $20 per dose to $1,500.

The drug, a synthetic form of progesterone trade named Makena, is recommended for women at high risk of delivering prematurely. And the price increase K-V Pharmaceutical Co. ignited a firestorm of objections from patients, medical organizations and political leaders including Sen. Sherrod Brown of Ohio.

Now, the FDA has declared it will not take enforcement action against pharmacies that fill prescriptions for the drug by compounding their own versions instead of using the version marketed by K-V.

The problem arises out of an unusual situation. Until early this year, women obtained the drug from so-called compounding pharmacies that produced it on a made-to-order basis.

Although custom-made for each patient, it had been priced at only about $20 per dose.

Then last February, K-V was granted exclusive rights for seven years to make Makena, ending, at least in theory, the need for made-to-order versions.

But the company's pricing announcement, coupled with letters K-V sent to pharmacies warning them of possible FDA enforcement action if they kept compounding the drug, aroused a strong push back from several members of Congress, including Brown and Amy Klobuchar, D-Minn., as well as from patients and obstetrical and pediatric groups.

Many complained that the huge cost increase was an unfair burden on patients, private insurers and Medicaid programs, which already are buckling as state budgets crumble in the face of a bad economy and declining revenues.

Responding to the public and political pressure, the FDA said it had no intention of blocking pharmacies from selling their own versions of Makena.

"In order to support access to this important drug, at this time and under this unique situation, FDA does not intend to take enforcement action against pharmacies that compound (Makena) based on a valid prescription," the statement said.

The agency noted that K-V "received considerable assistance from the federal government in connection with the development of Makena by relying on research funded by the National Institutes of Health to demonstrate the drug's effectiveness."

K-V shares lost 20 percent of their value Wednesday, closing at $5.65, down $1.46.

In a statement after the FDA's announcement, K-V said it would do more to make the drug affordable, though it did not say it would lower the price.

"Based on feedback the company has received, we are currently exploring additional ways to help provide affordable access for all patients who are prescribed Makena," the statement said.

Makena is administered in weekly injections, usually beginning at between 16 to 18 weeks into a pregnancy and continuing until 36 weeks.

K-V's pricing increased the cost of the drug to $30,000 from about $400 for that time period.

K-V's Makena application was approved under the Orphan Drug Act, which gives drugs needed by relatively small populations of patients expedited evaluation and confers seven years of protection from generic competition.

But the protection from competition does not include compounding pharmacies, whose products are not FDA-approved.

"Orphan drug exclusivity only prevents approval of another application for the same indication. Pharmacy compounding is not done under an approved application," said FDA spokesman Jeffrey Ventura.

FDA has the authority to crack down on compounding pharmacies when they offer products that compete with FDA-approved drugs, but is not obligated to do so.

Without making the comparison explicit, K-V's statement seemed to draw a contrast between Makena's status as an FDA-blessed compound and the non-approved products of compounding pharmacies.

Its one-page statement mentioned some variant of "FDA" or "FDA-approved" a dozen times.

"It's a non-issue," said James Moran, Chair of OB/GYN Department at Saint John's Health Center in Santa Monica, Calif. "There are plenty of really good compounding pharmacies we deal with all the time."

Since 2003, the American Congress of Obstetricians and Gynecologists has recommended that Makena be offered to high-risk women -- those who have had at least one previous preterm delivery.

An estimated 500,000 babies are born prematurely in the U.S. each year, and those births are associated with a range of health and developmental problems, as well as with billions of dollars in additional medical costs.